Online Pricing Experiment
In 2003, the NAP published the results of an innovative online experiment to determine the "cannibalization effect" that might obtain, if the NAP gave all reports away online, in PDF format.
Developed as a Mellon-funded grant, and working with the University of Maryland Business School, the experiment interrupted buyers just before finalizing an online order, with an opportunity to acquire the work in PDF for a randomly-generated discount: 50%, 10%, 100%, 70% off the list price, and if the answer was "no," the NAP would offer one more step off the price.
The conclusion resulted in 42% of the customers, when interrupted when buying a print book online, would take the free PDF of the book. Meaning that 58% of the potential purchasers were willing to pay to have a printed book. Significant implications to publishing strategies are produced by these numbers, especially in the context of NAP's "long tail" experience when it gave away free access to PDF (about 50% of the list) to low-sales content, which resulted in only 33% loss of sales, over 18 months (while enabling 100 times the dissemination).
Interestingly, through mid-2006, as reported at the AAUP annual meeting, as a publisher the NAP remained financially self-sustaining -- even while progressively expanding the utility of the online experience, and increasing its online traffic and dissemination. By mid-2009, the NAP's site was still receiving 1.5 million unique visitors per month, while generating 35% of the NAP's overall sales.
Multiple articles and presentations by Barbara Kline Pope, Executive Director of the NAP, and by Michael Jon Jensen, Director of Publishing Technologies for the NAP from 1998 through 2008, provide background on the evolving business strategies for "free in an environment of content abundance" that the National Academies Press continues to pursue.
Read more about this topic: National Academies Press
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